Category Archives: Economic Analysis

Give Me a Break You Bond Market Reporters

Posted on July 19, 2013 by Michael Harris

For reasons unknown to me some financial reporters like to talk about a US bond market meltdown. However, as the charts show the recent spike in yields can be hardly considered a meltdown. Actually, yields are still on a very strong downtrend … Continue reading →

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A Very High Probability Setup in SPY

Posted on June 17, 2013 by Price Action Lab

This pattern in SPY has unusually high historical win rate in the range of 76% – 100% for long positions with profit target in the range 2% – 5%.

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How The Media in its Struggle to Kill HFT is Actually Killing the Markets

Posted on June 8, 2013 by Michael Harris

This is a unique time in the history of mankind because so many get to speak publicly about subjects they do not understand at all and the blogosphere and electronic media is giving them this opportunity. Adversely hit by this high entropy … Continue reading →

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No Party Yet For Bond Bears

Posted on June 6, 2013 by Michael Harris

Although yields have risen lately and as a result bond prices have fallen, this is no party for bond bears. The 2.40% level in the 10-Year Note yield is very important and although it was reached twice before, in October of … Continue reading →

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The Net Value of All Market Calls is Exactly Zero

Posted on June 3, 2013 by Michael Harris

This is true at any instant, in the short-term, in the medium-term and in the longer-term. One needs not to have studied probability and statistics to know that any arbitrary market call made at any instant is drawn from a … Continue reading →

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Unique Period of Bond Yield Volatility a Result of Constant Portfolio Rebalancing

Posted on May 4, 2013 by Michael Harris

The 10-year Note yield rose 7.4% yesterday as managers were rebalancing their portfolios to reflect new information about the state of the economy and the objectives of the FED. This is a high level of daily volatility in bond yields and a phenomenon … Continue reading →

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Buying US stocks and Selling Emerging Market Stocks May Continue

Posted on April 19, 2013 by Michael Harris

Why is everyone buying US stocks and selling emerging market stocks? The Vanguard FTSE Emerging Markets ETF (VWO) has declined 6.53% while SPY has risen 8.24%, as of the close of yesterday and based on the close of last year. The main … Continue reading →

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Anti-Correlation Between Stocks and Bonds is Still High

Posted on April 1, 2013 by Michael Harris

The 12o-day rolling correlation between stocks and bonds made a low of -0.81 during February of 2012 and since then its has risen to slightly higher levels around -0.66. However, the correlation is still low and despite the correction due to a rise … Continue reading →

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ETF Correlations as of the Close of Thursday, March 28, 2013

Posted on March 30, 2013 by Michael Harris

Rolling 60-day correlations of SPY with TLT, FXE, GLD, SLV, USO and DBC, and trends developing since the last report on March 15, 2013. The correlation between stocks and commodities is on the rise again as the effects of financialization are becoming more pronounced … Continue reading →

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EURUSD at a Crucial Support Area

Posted on March 26, 2013 by Michael Harris

The euro is feeling the pressure of the political decision in EU to recapitalize banks using depositor money. According to some analysts, what happened in Cyprus was only an experiment for EU politicians to see how that could work in practice. The … Continue reading →

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